Italy – “Cheated by Barclays”.

Italy – “Cheated by Barclays”

A mortgage of 80,000 Euros is opened in 2007, to close in 2011 must pay a residual payable of € 73,000, but the user has to pay 30,000 Euros more, ie EUR 103,000 in total. Why? Because that mortgage (but no one had explained to consumers: click here to download the document) is indexed to the Swiss franc, which it has become very strong in 2011, because of the crisis, and has outperformed the euro. An anti-Barclays movement has born in Vicenza.

ROME – Mortgages in EUR indexed in CHF, this is the strategy adopted by Barclays, one of the most powerful banks in the world, to attract customers. From 1993 to 2011, in fact, the notorious bank stipulation English 9,978 mortgage contracts to Italian families to buy a house. In particular, the period in which they were sold more contracts than the period 2007-2008, which is when the Swiss franc had an exchange rate at all-time high. Which means that the euro was worth more, and then was offered to families, mostly single-income and jobs to precarious contract, as a bargain.

The strategy of the bank: those ‘strange’ contracts

Unfortunately, the bitter surprise: the mortgage is indexed, that means, it’s based on the value of the Swiss franc, the family was granted a loan in Swiss francs and not in the euro as had been proposed. And here comes the trick, because the left out of the Barclays consultants to tell its customers that of course the entire mortgage was in francs. So, the whole rate and the repayment of the loan ranged depending on the value of the Euro-Swiss Franc exchange: however, there was a high risk.

But how does the payment of the installment of the loan agreement with Barclays? The bank charges to its contractor the monthly fee plus a fixed amount that ends up in the provision. For years, customers have seen their debts to the bank and get off their bottoms up. But this was only a short-time effect, because then over the years has given the devaluation of the euro against the Swiss franc. So, over time, it increased the rate to be paid to the bank and meanwhile the money is not asked directly to the taxpayer, but were deducted from its provision. That’s not all: whoever was willing to pay off the mortgage early or ask for a subrogation to switch to another bank, you are facing a wall. Since the mortgage is in Swiss francs, even the extinction of the debt changed following the course of the conversion. Which means that today, with the franc at record lows, the mortgage to pay off increased.

The families of countermeasures: the birth of the Movement New Consumers

Following these opaque contracts was born on New Movement of Vicenza Consumers, and soon you too will be the ‘Tucofin’, an association of financial consumer protection. The exemplary case of the vice president of the Movement, Franca Berno: open a loan of EUR 80 thousand in 2007, wants to close it in 2011 with a residual payable of € 73 thousand, but finds himself having to pay 30 thousand euro more for the early repayment. Must pay 103 000 euro. All this because the franc in 2011, because of the economic crisis, has become stronger euro. What today asks the Vicenza movement at Barclays? Two fundamental aspects for them. The first: to be deleted from Article 7 of the contract, or the non-conversion from EUR to the CHF capital. The second, to be returned to those who have already closed the loan, the amounts paid in surplus.

From Spain to Italy: all lawsuits

This year, the ASUFIN, parallel to the association movement that operates in Spain, he has managed to win the lawsuit against Barclays. The judge in fact acknowledged that the British bank knew very well the trend of the Swiss franc, because it was based on the forecast charts drawn by Bloomberg. So Barclays knew that over the years the Swiss franc would be strengthened. In Italy, the Financial Banking Arbitrator has already delivered three judgments against Barclays, claiming the famous article 7 of the mortgage. Now, about 100 families are suing British financial institution to ‘little banking transparency’. Among the Court of Milan and that of Busto Arsizio are still ongoing the latest hearings. They expect the first instance judgments, for a time ranging from summer until the end of 2016.

The policy takes the field

Meanwhile, the policy has been moving: Senator of the Movement 5 Stars Vilma Moronese presented a parliamentary question and Simonetta Rubinato, the Democratic Party, it is affecting the affair, and hopes to speak soon with Barclays executives. “We have been called the ‘speculators’, which we are not – we are told by the Movement – we certainly did not want to play the stock market, ruining entire families with debts, but to ensure a home and a solid future for our children“.